Altamira Gold Corp. press release
AEX Gold Inc. Reports Second Quarter Financial Results
TSXV - TSX Venture Exchange · Gold · Copper · Canada
TORONTO, ON / ACCESSWIRE / August 27, 2020 / AEX Gold Inc. (AIM:AEXG)(TSXV:AEX), an independent gold company with a portfolio of gold licences in Greenland, announces its unaudited condensed interim consolidated financial statements ("Financial Statements") for the quarter ended June 30, 2020. All figures are in Canadian dollars unless otherwise noted.
The Financial Statements and the accompanying Management Discussion and Analysis are available on the Corporation's website at www.aexgold.comand will be filed under the Corporation's SEDAR profile at www.sedar.comlater today.
Financial Highlights
The Corporation reported a net loss of $3.4 million in H1 2020 (H1 2019: $1.1 million), driven by increased exploration and evaluation activities and corporate activity during the period, as well as non-cash stock based compensation. Exploration and evaluation expenses during the period were $1.5 million (H1 2019: $0.6 million), driven by increased activity on the Nalunaq Property and its regional exploration portfolio. General and administrative expenses during the period were $0.9 million (H1 2020: $0.5 million), with the increase a result of higher management, consulting and professional fees as the Corporation moves towards development at Nalunaq and ahead of its AIM listing. During the period, 11,387,626 warrants were exercised, each entitling the holder to receive one common share of the Corporation, at an exercise price per warrant between $0.45 and $0.50, with the Corporation receiving gross proceeds of $5.1 million. The Corporation granted 2,195,000 options to its directors, officers and consultants, based on an estimated fair value of $0.47 per option, representing a total non-cash cost of $1.0 million in the period. The Corporation had a cash balance of $4.4 million at June 30, 2020 ($1.5 million at December 31, 2019), with no debt, and total working capital of $3.0 million ($1.2 million at December 31, 2019). Post-period end, the Corporation completed an equity placing raising gross proceeds of $72.7 million (£42.5 million).
Selected Financial Information
The following selected financial data is extracted from the Financial Statements for the six months ended June 30, 2020.
Financial Results
| | | Three months
ended June 30, | | | Six months
ended June 30, | | | | | | | | | | | | | | | 2020 | | | 2019 | | | 2020 | | | 2019 | | | | | | | | | | $ | | | | $ | | | | $ | | | | $ | | | Exploration and evaluation expenses | | | 912,676 | | | | 397,220 | | | | 1,524,451 | | | | 565,822 | | | General and administrative | | | 498,639 | | | | 277,335 | | | | 881,550 | | | | 493,796 | | | Net loss and comprehensive loss | | | (2,442,132 | ) | | | (673,725 | ) | | | (3,408,569 | ) | | | (1,075,130 | ) | | Basic and diluted loss per common share | | | (0.03 | ) | | | (0.01 | ) | | | (0.04 | ) | | | (0.02 | ) |
Financial Position
| | | As at June 30, 2020 | | | As at December 31, 2019 | | | | | | | | $ | | | | $ | | | Cash on hand | | | 4,441,089 | | | | 1,515,406 | | | Total assets | | | 6,547,834 | | | | 2,720,473 | | | Total current liabilities | | | 1,682,113 | | | | 645,933 | | | Shareholders' equity | | | 4,865,721 | | | | 2,074,540 | | | Working capital | | | 2,978,497 | | | | 1,157,012 | |
Corporate and Operational Highlights
A business readiness program was initiated internally during the period as the Corporation increases its overall readiness for transitioning towards project execution, including human resources, recruiting, environmental and social impact assessment scoping, organizational structuring, project and cost control, and accounting. In June 2020, the Greenlandic COVID Commission approved AEX's mobilization plan and on August 15, 2020 the Corporation successfully and safely mobilized its expatriate and local Greenlandic workforce on site at the Nalunaq Property ahead of the commencement of the 2020 summer work program. During the period, the Corporation was granted two new Mineral Exploration Licences in South Greenland, namely Saarloq and Anoritooq, covering an area totalling 2,528km2, taking the Corporations full license area to 3,356km2. The Corporation intends to conduct exploration activities over these new licence areas, as well as it's wider regional portfolio, as part of the 2020 summer work program announced on August 24, 2020.
Post Period-End
On July 27, 2020, the Corporation appointed Sigurbjorn ("Siggi") Thorkelsson as an independent non-executive director of the Corporation and Chair of the Audit and Risk Committee. Mr. Thorkelsson brings a wealth of experience in the financial markets, having worked at major financial institutions throughout his career. On July 31, 2020, the Corporation completed its AIM Admission in addition to its existing TSX-V listing, with the issue of 94,444,445 common shares at a price of GBP 0.45 (C$0.77) per share. The Corporation has progressed a number of discussions with non-equity financing providers, as detailed at the time of the fundraise in July 2020. The Board believes a modest non-equity facility offers an attractive opportunity to access additional capital to expand value creation activities across its portfolio without the dilution or costs of further equity. The Corporation is committed to securing the most attractive source of funding, and will provide an update on these discussions once a committed facility is secured.
Eldur Olafsson, CEO of AEX, commented:
"I'm pleased to announce our H1 2020 financial results, which demonstrate the significant increase in activity across our portfolio as our business transitions towards development.
"Following the successful $72.7 million fundraise and AIM listing in July 2020, the Company is in a very strong position and we are now funded for our planned work program at Nalunaq, where we are progressing well with the exploration and pre-development work on the asset. In addition to this, we are undergoing additional exploration work across our wider portfolio in Southern Greenland where we believe there is significant upside for investors in what is a materially undeveloped region.
"We look forward to providing updates to the market on these exciting workstreams in due course."
"As stated at the time of the fundraise, we are looking to secure additional non-equity funding in the form of a modest working capital facility, vendor financing or similar, to accelerate exploration activities across our material portfolio of gold assets in South Greenland. Whilst we will look to execute on this facility as soon as possible, we are in a very strong position post-fundraise and will take time to ensure that any facility we enter into offers the best terms to our company and shareholders, and look forward to updating the market at the appropriate time."
Enquiries:
AEX Gold Inc.
George Fowlie, Director and CFO 1-416-587-9801 gf@aexgold.com
Eldur Olafsson, Director and CEO +354 665 2003 eo@aexgold.com
Stifel Nicolaus Europe Limited (Nominated Adviser and Broker)
Callum Stewart Simon Mensley Ashton Clanfield +44 (0) 20 7710 7600
Camarco (Financial PR)
Gordon Poole Nick Hennis +44 (0) 20 3757 4980
AEX Gold Inc: Unaudited Condensed Interim Consolidated Financial Statements for the Six Months Ended June 30, 2020 Consolidated Statements of Financial Position (Unaudited, in Canadian Dollars)
| | | | | | As at
June 30, | | | As at December 31, | | | | | | | | Notes | | | 2020 | | | 2019 | | | | | | | | | | | $ | | | $ | | | | | | ASSETS | | | | | | | | | | | | | | Current assets | | | | | | | | | | | | | | Cash | | | | | | 4,441,089 | | | | 1,515,406 | | | | Escrow account for environmental monitoring | | | | | | 186,282 | | | | 174,864 | | | | Sales tax receivable | | | | | | 31,859 | | | | 17,792 | | | | Prepaid expenses and others | | | | | | 1,380 | | | | 94,883 | | | | Total current assets | | | | | | 4,660,610 | | | | 1,802,945 | | | | | | | | | | | | | | | | | | Non-current assets | | | | | | | | | | | | | | Deferred share issuance costs | | | 9 | | | | 1,221,138 | | | | 166,348 | | | Escrow account for environmental monitoring | | | | | | | 357,618 | | | | 342,132 | | | Mineral properties | | | 3 | | | | 55,682 | | | | 41,945 | | | Property and equipment | | | 4 | | | | 252,786 | | | | 367,103 | | | Total non-current assets | | | | | | | 1,887,224 | | | | 917,528 | | | TOTAL ASSETS | | | | | | | 6,547,834 | | | | 2,720,473 | | | | | | | | | | | | | | | | | LIABILITIES AND EQUITY | | | | | | | | | | | | | | Current liabilities | | | | | | | | | | | | | | Trade and other payables | | | | | | | 1,495,831 | | | | 471,069 | | | Environmental monitoring provision | | | | | | | 186,282 | | | | 174,864 | | | | | | | | | | | | | | | | | Total liabilities | | | | | | | 1,682,113 | | | | 645,933 | | | | | | | | | | | | | | | | | Equity | | | | | | | | | | | | | | Capital stock | | | | | | | 20,084,129 | | | | 13,883,611 | | | Warrants | | | 5 | | | | 238,749 | | | | 1,459,604 | | | Contributed surplus | | | | | | | 2,755,487 | | | | 1,535,400 | | | Accumulated other comprehensive loss | | | | | | | (36.772 | ) | | | (36,772 | ) | | Deficit | | | | | | | (18,175,872 | ) | | | (14,767,303 | ) | | Total equity | | | | | | | 4,865,721 | | | | 2,074,540 | | | TOTAL LIABILITIES AND EQUITY | | | | | | | 6,547,834 | | | | 2,720,473 | | | | | | | | | | | | | | | | | Going concern | | | 1 | | | | | | | | | | | Subsequent events | | | 9 | | | | | | | | | |
The accompanying notes are an integral part of these unaudited condensed interim consolidated financial statements.
Consolidated Statements of Comprehensive Loss
(Unaudited, in Canadian Dollars)
| | | | | | Three months
ended June 30, | | | Six months
ended June 30, | | | | | | | | | | | | | | | | Notes | | | 2020 | | | 2019 | | | 2020 | | | 2019 | | | | | | | | | | | | | $ | | | $ | | | $ | | | $ | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | Expenses | | | | | | | | | | | | | | | | | | | | | | Exploration and evaluation expenses | | | 7 | | | | 912,676 | | | | 397,220 | | | | 1,524,451 | | | | 565,822 | | | General and administrative | | | 8 | | | | 498,639 | | | | 277,335 | | | | 881,550 | | | | 493,796 | | | Stock-based compensation | | | 6 | | | | 1,031,650 | | | | - | | | | 1,031,650 | | | | - | | | Foreign exchange loss (gain) | | | | | | | 3,830 | | | | 1,773 | | | | (21,567 | ) | | | 17,935 | | | Operating loss | | | | | | | 2,446,795 | | | | 676,328 | | | | 3,416,084 | | | | 1,077,553 | | | Other expenses (income) | | | | | | | | | | | | | | | | | | | | | | Interest income | | | | | | | (4,873 | ) | | | (4,765 | ) | | | (9,915 | ) | | | (7,065 | ) | | Finance costs | | | | | | | 210 | | | | 2,162 | | | | 2,400 | | | | 4,642 | | | | | | | | | | | | | | | | | | | | | | | | | Net loss and comprehensive loss | | | | | | | (2,442,132) | | | | (673,725) | | | | (3,408,569) | | | | (1,075,130) | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | Weighted average number of common shares outstanding - basic and diluted | | | | | | | 81,176,725 | | | | 58,222,276 | | | | 77,307,646 | | | | 58,006,586 | | | Basic and diluted loss per common share | | | | | | | (0.03 | ) | | | (0.01 | ) | | | (0.04 | ) | | | (0.02 | ) | | | | | | | | | | | | | | | | | | | | | | |
The accompanying notes are an integral part of these unaudited condensed interim consolidated financial statements.
Consolidated Statements of Changes in Equity (Unaudited, in Canadian Dollars)
| | | Notes | | | Number of common shares
outstanding | | | Capital
Stock | | | Warrants | | | Contributed surplus | | | Accumulated other comprehensive loss | | | Deficit | | | Total
Equity | | | | | | | | | | | | | | | | | | | $ | | | $ | | | $ | | | $ | | | $ | | | $ | | | | | | | | | | | Balance at January 1, 2019 | | | | | | 57,788,499 | | | | 10,058,355 | | | | 321,788 | | | | 956,800 | | | | (36,772) | | | | (9,665,197) | | | | 1,634,974 | | | | Net loss and comprehensive loss | | | | | | - | | | | - | | | | - | | | | - | | | | - | | | | (1,075,130 | ) | | | (1,075,130 | ) | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | Shares and warrants issuance under private placements | | | | | | 13,157,895 | | | | 3,853,718 | | | | 1,146,282 | | | | - | | | | - | | | | - | | | | 5,000,000 | | | | Share issuance costs | | | | | | - | | | | (28,462 | ) | | | (8,466 | ) | | | - | | | | - | | | | - | | | | (36,928 | ) | | | Balance at June 30, 2019 | | | | | | 70,946,394 | | | | 13,883,611 | | | | 1,459,604 | | | | 956,800 | | | | (36,772) | | | | (10,740,327) | | | | 5,522,916 | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | Balance at January 1, 2020 | | | | | | 70,946,394 | | | | 13,883,611 | | | | 1,459,604 | | | | 1,535,400 | | | | (36,772) | | | | (14,767,303) | | | | 2,074,540 | | | | Net loss and comprehensive loss | | | | | | - | | | | - | | | | - | | | | - | | | | - | | | | (3,408,569 | ) | | | (3,408,569 | ) | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | Warrants exercised | | | 5 | | | | 11,387,626 | | | | 6,140,518 | | | | (1,010,418 | ) | | | - | | | | - | | | | - | | | | 5,130,100 | | | Warrants expired | | | 5 | | | | - | | | | - | | | | (210,437 | ) | | | 210,437 | | | | - | | | | - | | | | - | | | Options exercised | | | 6 | | | | 100,000 | | | | 60,000 | | | | - | | | | (22,000 | ) | | | - | | | | - | | | | 38,000 | | | Stock-based compensation | | | 6 | | | | - | | | | - | | | | - | | | | 1,031,650 | | | | - | | | | - | | | | 1,031,650 | | | Balance at June 30, 2020 | | | | | | | 82,434,020 | | | | 20,084,129 | | | | 238,749 | | | | 2,755,487 | | | | (36,772) | | | | (18,175,872) | | | | 4,865,721 | |
The accompanying notes are an integral part of these unaudited condensed interim consolidated financial statements.
Consolidated Statements of Cash Flows (Unaudited, in Canadian Dollars)
| | | Notes | | | Six months
ended June 30, | | | | | | | | | | | | | | 2020 | | | 2019 | | | | | | | | | | | $ | | | $ | | | | | | | | | | | | | | | | | | | | Operating activities | | | | | | | | | | | | | | Net loss for the period | | | | | | (3,408,569 | ) | | | (1,075,130 | ) | | | Adjustments for: | | | | | | | | | | | | | | Depreciation | | | 4 | | | | 114,317 | | | | 82,863 | | | Stock-based compensation | | | 6 | | | | 1,031,650 | | | | - | | | Finance costs | | | | | | | 2,400 | | | | 4,642 | | | Payment from cash held in escrow account for environmental monitoring | | | | | | | - | | | | (28,846 | ) | | Escrow account for environmental monitoring | | | | | | | - | | | | 28,846 | | | Foreign exchange loss (gain) | | | | | | | (19,112 | ) | | | 19,380 | | | | | | | | | | (2,279,314 | ) | | | (968,245 | ) | | Changes in non-cash working capital items: | | | | | | | | | | | | | | Sales tax receivable | | | | | | | (14,067 | ) | | | (13,215 | ) | | Prepaid expenses and others | | | | | | | 93,561 | | | | 1,467 | | | Trade and other payables | | | | | | | 293,916 | | | | 271,621 | | | Payables to shareholders | | | | | | | - | | | | 4,762 | | | | | | | | | | 373,410 | | | | 264,635 | | | Cash flow used in operating activities | | | | | | | (1,905,904) | | | | (703,610) | | | | | | | | | | | | | | | | | Investing activities | | | | | | | | | | | | | | Acquisition of mineral properties | | | 3 | | | | (13,737 | ) | | | - | | | Acquisition of property and equipment | | | | | | | - | | | | (10,514 | ) | | Cash flow used in investing activities | | | | | | | (13,737) | | | | (10,514) | | | | | | | | | | | | | | | | | Financing activities | | | | | | | | | | | | | | Shares and warrants issuance | | | | | | | - | | | | 5,000,000 | | | Share issuance costs | | | | | | | - | | | | (750 | ) | | Exercise of warrants | | | 5 | | | | 5,130,100 | | | | - | | | Exercise of stock options | | | 6 | | | | 38,000 | | | | - | | | Deferred share issuance costs | | | 9 | | | | (324,293 | ) | | | - | | | Cash flow from financing activities | | | | | | | 4,843,807 | | | | 4,999,250 | | | | | | | | | | | | | | | | | Net change in cash before effects of exchange rate changes on cash during the period | | | | | | | 2,924,166 | | | | 4,285,126 | | | Effects of exchange rate changes on cash | | | | | | | 1,517 | | | | (3,447 | ) | | Net change in cash during the period | | | | | | | 2,925,683 | | | | 4,281,679 | | | Cash, beginning of period | | | | | | | 1,515,406 | | | | 963,788 | | | Cash, end of period | | | | | | | 4,441,089 | | | | 5,245,467 | | | | | | | | | | | | | | | | | Supplemental cash flow information | | | | | | | | | | | | | | Interest received | | | | | | | 9,915 | | | | 7,065 | | | Share issuance costs included in trade and other payables | | | | | | | - | | | | 36,178 | | | Acquisition of mineral properties included in trade and other payables | | | | | | | - | | | | - | | | Exercise of warrants credited to capital stock | | | | | | | 1,010,418 | | | | - | | | Exercise of stock options credited to capital stock | | | | | | | 22,000 | | | | - | | | Deferred share issuance costs included in trade and other payables | | | | | | | 851,228 | | | | - | | | | | | | | | | | | | | | |
The accompanying notes are an integral part of these unaudited condensed interim consolidated financial statements.
Condensed Notes to the interim Consolidated Financial Statements Six months ended June 30, 2020 and 2019 (Unaudited, in Canadian Dollars)
1. NATURE OF OPERATIONS, BASIS OF PRESENTATION AND GOING CONCERN
AEX Gold Inc. (the "Corporation") was incorporated on February 22, 2017 under the Canada Business Corporations Act. The Corporation's head office is situated at 3400, One First Canadian Place, P.O. Box 130, Toronto, Ontario, M5X 1A4, Canada. The Corporation operates in one industry segment, being the acquisition, exploration and development of mineral properties. It owns interests in properties located in Greenland. The Corporation's financial year ends on December 31. Since July 2017, the Corporation's shares are listed on the TSX Venture Exchange (the "TSX-V") under the AEX ticker and since July 2020, the Corporation's shares are also listed on the AIM market of the London Stock Exchange ("AIM") under the AEXG ticker (note 9).
These unaudited condensed interim consolidated financial statements for the six months ended June 30, 2020 ("Financial Statements") were approved by the Board of Directors on August 26, 2020.
1.1 Basis of presentation
The Financial Statements have been prepared in accordance with International Financial Reporting Standards ("IFRS") as issued by the International Accounting Standards Board ("IASB") including International Accounting Standard ("IAS") 34, Interim Financial Reporting. The Financial Statements have been prepared under the historical cost convention.
The Financial Statements should be read in conjunction with the annual financial statements for the year ended December 31, 2019 which have been prepared in accordance with IFRS as issued by the IASB. The accounting policies, methods of computation and presentation applied in these Financial Statements are consistent with those of the previous financial year ended December 31, 2019.
1.2 Going concern
The Financial Statements were prepared using IFRS applicable to a going concern, which contemplates the realization of assets and settlement of liabilities in the normal course of business as they come due. In assessing whether the going concern assumption is appropriate, senior management of the Corporation ("Management") takes into account all available information about the future, which is at least, but not limited to, twelve months from the end of the reporting period. Management is aware in making its assessment of material uncertainties related to events and conditions that lend a significant doubt upon the Corporation' ability to continue as a going concern and accordingly, the appropriateness of the use of IFRS applicable to a going concern, as described in the following paragraph. The Financial Statements do not reflect the adjustment to the carrying values of assets and liabilities, expenses and financial position classifications that would be necessary if the going concern assumption would not be appropriate. These adjustments could be material.